7 Steps to Building a Winning Digital Strategy: An Executive Guide

Text summary of this guide

In the age of Google, Facebook and iPad, every business organisation needs to build a solid strategy to:

harness the power of the Web in reaching, influencing and engaging with their customer;

bring efficiency in their business processes; and

enable conversations and collaboration with their partners, suppliers and other stakeholders.

This guide is intended to help business owners / executives have a systematic process and a guiding framework when they embark on the exercise of creating a digital strategy for their organisation.???Here is an overview of Simplogy?s step-by-step guidance in building a winning digital strategy:

Create the systems, processes and teams to manage performance and maintain sustainable operations

Video summary of this guide

Full text:?7 Steps to Building a Winning Digital Strategy

Introduction

?You can stop an invading army; you cannot stop an idea whose time has come.??Victor Hugo

The potential of Internet in business is no longer just potential, it?s a reality.

We are only at the beginning of the e-business revolution. The time to harness its potential for your business is NOW.

If you still believe that the digital revolution is all humbug, watch this video that will show how the Web is changing our life. And if you are still not convinced, here are a few more facts and ideas:

76% of the Australian population is connected to the Web by broadband. 61% have made a purchase online in the past year. An average user spends 17.6 hours online per week according to this report. Over 9 million Australians are members of Facebook.

Gen Y is especially receptive to communicating, engaging, collaborating and socialising online and this behaviour extends to their business dealings.

Digital natives, those born after 1995, will be joining the workforce within 5 years. For them, digital is not a technology, it?s a device. It?s as simple as what TV was to Gen X?ers. It?s even a way of life ? an always-available, reliable network that runs the services that provides the dominant platform for work as well as play.

Worldwide, several industry sectors ? books retail, travel booking, music retail, dating match-making – have transformed due to new, disruptive Web businesses. Many more, eventually most, are waiting to be changed forever.

Web usage in Australia, both in business and consumer sectors, is one of the most advanced in the world. And, the role of digital technology in business and life will only increase as the much discussed National Broadband Network makes it presence felt.

Building and implementing a digital strategy for your business could be the key to your survival as a player in future. It may also give you an opportunity to lead your industry, in lower costs, in higher efficiency, in better customer service, in access, in innovation or in a dozen different other ways.

Create the systems, processes and teams to manage performance and maintain sustainable operations

Step 1: Define the business objective

Why are you building a Web business strategy? What is the business problem that you are trying to solve? What would happen if you successfully implement a digital strategy? What would happen if you don?t?

Wrong answer 1: ?We need to be online because everyone is?

This is not a sufficient reason. Be more specific about what problem are you going to solve and what objectives are you going to achieve with your digital strategy.

Your competitors may have an entirely different set of strengths and weaknesses, assets and capabilities, and they may be trying to achieve an objective that you don?t need to match.

What should you do?

Brainstorm with colleagues and associates why you need to create or review your strategy.

Discover what problems is your organization facing and whether Web-ising or mobil-izing one or more of your processes help solve those problems.

Examples:

Are your customers online but you are not?

Are you losing customers to competitors because they can be found online and you don?t.

Are your customer?s unhappy because you cannot match their expectations of online customer service.

Do you interact with your customers by phone? Personal meeting? Seminars or group meetings? E-mail? Are these channels sufficient?

Do you believe you should engage with customers more but lack the channels to do so?

The problems and objectives may be related to sales, profits, margins, customer acquisition, customer retention, competitor activity, product features, industry trends pointing against your business model, missed opportunities or other aspects of business.

You must articulate your business objective clearly to be able to solve it.

Step 2: Analyse your online business space

Environment, market, customer and competition

This is an important but comprehensive step. Gather insights about your online marketspace:

Environment:

What trends in technology, government, economic, regulatory, consumer behaviour, innovations and uncertainties are affecting the online business environment. First discover issues that affect all industries in your space and then those that are specific to your industry.

Market:

Estimate the size, growth, profitability, trends and developments and identify Key Success Factors (KSFs) for online channels in your industry. Mapping the keyword marketplace to the online market can be valuable. For example, you may guesstimate the size and growth of the market by compiling the volume and growth in relevant keywords.

Customer:

Who are your existing or prospective online customers? Besides segmenting customers on the usual bases such as demographics (such as age, gender, education etc), you can also segment them by their Web site usage, traffic source, geography, online behaviour and other points of rich information that you may collect when customers arrive at your Web site.

Competition:

Online research can provide rich information about competition. Use competitive intelligence tools to find out traffic rankings of your competitors, what keywords is your competition targeting, how much traffic they receive for their keywords on which pages and how they convert their traffic into sales. Don?t forget to add those competitors who may not be present in the online space today but as existing industry players, may introduce online offerings in future.

Tools:

Google Insights for Search?provides you volume patterns of keywords. You may compare two or more keywords to compare and contrast their volume patterns over time.

Google Alerts?helps you monitor the Web by receiving e-mail updates of latest, relevant Google results based on your keywords (topic or query)

Google Keyword tool?provides you the volume and competition of keywords that you choose and help you expand your list of keywords list.

Hitwise tools?for industry and competition research provide information on rankings, search intelligence, conversions and other industry research and competitive intelligence

Step 3: Assess your digital assets and capabilities

Conduct a SWOT analysis i.e., list your strengths, weaknesses, opportunities and threats (SWOT). Keep in mind the context set in the analysis you did in step 2. A few of the factors that may determine your SWOT are:

The state of your present Web sites, their PageRank, age, traffic, conversion rate

Maturity of your online marketing campaigns

???? Availability of expert in-house personnel or access to reliable, scalable service providers

Growth rate of your online market space

Entry barriers to enter your market space

Step 4: Create alternative online customer value propositions

Evaluate, select and work out your positioning in your online market space

At its simplest, value proposition is a set of distinct market space, value experience, offering, benefits and differentiation. The basis of your value proposition may be quality, value, niche offering, emotional benefit or perceived benefits of value, excellence, overall quality or breadth.

You need to employ structured creative thinking to work out a few customer value propositions that fit the analysis in steps 2 and step 3.

There is no formula but what we have observed to work is to rigorously apply your mind in discovering a number of value propositions and then rank them by the degree to which they are consistent with the analysis in step 2 and step 3. Your digital assets and competencies should match your online value proposition.

Tool

A practical tool that can help you shortlist your value propositions is a fit vs attractiveness analysis. It?s a simple model that may help you rank and shortlist your ideas. Assess the fit that the alternative value propositions have with your environment, market, customer and competition, and with internal assets and capabilities. Then assess the attractiveness of the market that you are entering.

When you plot the different value propositions in a grid, you may ignore all those alternatives that have a lot fit and low attractiveness.? Select the value proposition that is a strength or at least has potential.

Improve?

Strength

Strength

Fit

Avoid

Potential

Strength

Avoid

Avoid

Gap

Attractiveness –>

You should now be able to write a positioning statement in the pattern of:

To [target market segment], we are [our role in their life or their need that we can fulfill] that [benefits we provide] because of [our capability and strategic competitive advantage].

Example

To the digital natives who are car owners, we are their online car insurers that provide services only in the platform of their choice – online, engage with them and offer cheaper premiums because of our online marketing and operations expertise and lower cost due to online-only offering.

Step 5: Build a media & marketing plan

How we would bring the value proposition to market and promote it. This plan contains specific assets, tactics, channels, processes and tools that we will use to

build our offerings into the selected market segment with the selected benefits;

provide value experience; and

highlight our differentiation.

Depending on the company?s situation, the thrust of the plan may be on customer acquisition, customer retention, customer experience, service & support. At this stage, we plan the specific changes required to be made with regards to distribution, pricing, brand, communication, CRM, IT and other functional areas so that they are aligned with the online value proposition. Your strategy should balance owned, earned and paid media.

Step 6: Create digital assets and set up conversation platforms

The most important digital asset is your Web site. It?s an owned media and is amenable to your control. Ensure that the Web site requirements are aligned with the branding, distribution, pricing and communication strategies you created in step 5.

A digital project management framework must be employed and implementation should be in stages with your feedback and approval. These stages are:

Requirements: Formal notes about what tasks will the customer perform, how each separate functionality will flow and connect.

Experience design: Wireframes, flow of activities and processes.

Data modelling: Design the structure of database

Design: Visual creation

Design coding (sliced / coded into Web languages)

???? Logic: Coding in middle layer, unit testing

Hosting locally and system testing by users

Deployment: Configuring the host and setting up all website components and final testing.

Training and orientation of in-house users

Beta programme, launch and iterate

Maintenance: Monitoring, software upgrades, enhancements

Mobile Web sites, iPod and iPad applications are also examples of digital assets that are owned media.

Once you have created the digital assets, you need to reach out to and engage with your market with the help of paid and earned media. Use both traditional and digital media. There are a number of channels that are available to the marketer to reach out to and engage with your market.

Traditional media and marketing channels are TV (the classic 30 second ad), radio, newspaper and magazines, trade publications, exhibitions and tradeshows, sponsorships, outdoors and directories. Many of these channels are declining in importance but a few such as exhibitions and tradeshows remain as important as ever.

Online marketing channels are:

Paid media such as email, search engine advertising, social media advertising such as LinkedIn DirectAds and Facebook Ads, affiliate marketing (paid as a percent of sale); and

Earned media such as search engine traffic as a result of SEO, social media and online public relations. These tactics often result in inbound traffic and therefore called inbound marketing channels.

Set up the online marketing accounts and platforms for conversations such as Facebook pages, LinkedIn groups and others as per your plan in step 5.

???? Systems to report and prioritise bugs and enhancements and continuing development of new features

Review of strategy and tactics, media and marketing plan

Conclusion

An effective digital strategy can help you deliver compelling value to your customers, improve your profitability and build a sustainable competitive advantage. But you need to discover, understand and execute a winning set of digital strategies, tools and processes to harness the online revolution. In this guide, we showed you a 7-step plan to build a digital strategy in 7 pages.

To recap, you need to:

Define your business objectives in going online. Brainstorm with colleagues. Be specific.

Gather insights and analyse your online marketspace

To complete the analysis, assess your own digital assets and capabilities

Create a media and marketing plan to implement the above strategy into the market.

???? Create digital assets such as Web sites systematically by using best practices in Web project management, Use the right mix of traditional and online marketing, with a balance of earned, owned and paid media.

Create the systems, processes and teams to manage performance and maintain sustainable operations

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About the author

Hasnain Zaheer is a Director in Simplogy. He is a Certified Practicing Marketer (CPM), Associate Member of Australian Marketing Institute (AM AMI), holds a Masters in Management (Macquarie Graduate School of Management), qualified Google AdWords Advanced and Reporting & Analysis Professional, and certified in training and assessments among other qualifications.

He leads digital strategy and digital led business transformation practice at Simplogy and helps organisations build great digital products, eliminate risks from digital projects, and build capacity and capability in digital teams with coaching, training and workshops. Learn more or contact him.